Brent Rises as US Prepares to Help Refiners Increase Fuel Output

The Oct’26 Brent futures contract has climbed from $90.75/bbl at 15:41 BST to $91.67/bbl at 16:54 BST (time of writing). In the news, US Energy Secretary Chris Wright has said that Washington will announce measures within days to help refiners increase fuel output, as the Trump administration looks to bring down gasoline prices that have risen sharply following the US-Israeli war with Iran. US refiners are already running at high rates, but Wright said higher throughput domestically and abroad will be key to easing prices. US gasoline prices remain above $4/gal, around 30% higher y/y, adding pressure ahead of November’s midterm elections. Elsewhere, COSCO and China Merchants Energy Shipping have avoided the Strait of Hormuz and Bab al-Mandeb since late July amid ongoing conflict. The two state-owned shippers, which operate over 100 VLCCs and previously handled around half of China’s Middle East crude imports, are instead collecting cargoes outside the Gulf as security concerns disrupt regional flows. In South Korea, Idemitsu Kosan has begun sourcing Saudi crude from Yanbu via Suez and the Cape of Good Hope, with longer transit times and higher freight costs but no near-term supply concerns. The refiner is also supported by UAE crude via Fujairah and North American imports. Houthis’ attacks have made Bab el-Mandeb largely impassable for Saudi shipments, extending voyages from ~20 days to up to 60 days. Despite the disruption, Idemitsu plans to maintain its reliance on Middle Eastern crude, citing its suitability for Japanese refineries and the high cost of switching to alternative grades. Finally, as of the time of writing, the front-month (Oct/Nov’26) and 6-month (Oct/Apr’27) Brent futures spreads are at $1.61/bbl and $9.57/bbl, respectively.

This afternoon in Dated we saw the market continue to sell off pre-window before bouncing back in the window. Pre-window we saw Balmo Aug DFL trade down to -$0.50/bbl and 24-28 Aug vs Cal Sep trade down to -$0.58/bbl. Sep DFL also traded down to lows of $1.60/bbl. In the physical window we saw Midland and Forties cargos continue to be offered, pushing down the implied differential, however, today we saw 3 Midland cargos trade with a major lifting 2. In the paper window, a trade bought 14-18 Sep CFD up to $2.00/bbl and 24-28 Aug vs Cal Sep was bought up to $0.05/bbl. Post window we saw some Sep/Oct Dated buying come out, trading up to $2.12/bbl.

This afternoon in Brent/Duabi continued to be quiet, with similar flows to this morning. There continued to be fund selling of Dec Brent/Duabi around $5.25/bbl, buying of Fulmo Aug Brent swap vs Sep Dubai. There was also some major buying of Nov ICE Brent futures vs Oct Dubai. Sep Brent/Duabi could not hold onto the rally from this morning, selling back off from $4.40/bbl to $4.10/bbl. The Dubai spreads traded largely rangebound, the Sep/Oct trading between $3.20/bbl to $3.30/bbl. Brent/Duabi boxes also traded rangebound, the Sep/Oct box trading slightly weaker into close, down from -$1.10/bbl to -$1.23/bbl.

In VLSFO, Sep/Oct Sing 0.5 was rangebound this afternoon, trading at the same level as this morning's close of $35.00/mt. Sep Sing cracks also consistently traded at a similar level to this morning's close, trading between $18.10/bbl and $18.20/bbl.
Sep/Oct Euro 0.5% traded slightly higher this afternoon gaining a dollar and finishing the window at $21.00/mt. Sep Barge crack found some buying after this morning's sell off, trading up to $5.85/bbl.

In HSFO, Chinese Fund was buying Oct 380 flat price in decent volume this afternoon, during the window Sep/Oct and Oct/Nov 380 traded at $39.00/mt and $25.00/mt respectively. Sep 380 crack traded at a similar level to this morning closing the window out at $0.35/bbl.
There was little spoken of Sep/Oct Barges; it traded up to $19.25/mt post window. Sep Barge crack was stronger this afternoon, trading up from -$9.05/bbl to -$8.55/bbl due to real buying.

This afternoon in distillates, Sing gasoil spreads were mixed, with Sep/Oct scale back offered on higher ICE gasoil, while Oct/Nov saw buying between $6.60/bbl and $6.70/bbl. Front E/W rallied, with Sep trading from -$71/mt up to -$69.50/mt, lifted last, while the Q4 offer pulled back to -$58.25/mt. Dec regrade selling stepped down to $3.95/bbl and kero spreads saw continued selling.

Prompt ICE gasoil spreads sold off throughout the afternoon, with Sep/Dec trading from $172/mt down to $167/mt, while cracks sold off initially to lows of $74.75/bbl before rallying to $75.70/bbl post window. European jet diffs weakened into Q4, with Sep trading down to $66/mt. Both heating oil spreads and HOGOs firmed, with the Sep HOGO swap from 27.3c/gal up to 28.0c/gal.

This afternoon gasoline was strong once again. RBBRs initially came off post US open before rallying into the window, but arbs were well offered down the curve, with Sep trading down to lows of 5.10c/gal. Arb selling pushed EBOB cracks up from $33.50/bbl to $34.45/bbl, with Q4 valued at $19.75/bbl. Spreads rallied as well on stronger RBBRs and crude, with Sep/Oct trading up from $97.50/mt to $99/mt. E/W came off in the front as EBOB strengthened, falling from -$13/bbl to -$13.25/bbl, with Sep cracks seeing scaleback selling up to $21.20/bbl.

This afternoon in naphtha was firmer in NWE after the softer morning, with naphtha MOC better bid and Sep cracks recovering from around -$4.85/bbl to -$4.40/bbl in the window, with good Q4/Q1 crack roll buying at $0.90/mt. Prompt spreads were illiquid but better bid, with Sep/Oct moving from around $ $23.25/mt to $25.75/mt bid post-window, and Dec/Jan around $18/mt. E/W was steady after the morning softness, with Sep at $37.50/mt, and the Sep/Oct box bid up to -$1.50/mt. MOPJ spreads were bid but on limited volume, with Sep/Oct moving up from $22/mt in the early afternoon to $24.25/mt bid through the window, and Dec/Mar trading at $45/mt.

This afternoon in NGLs, Sep LST/FEI priced up from the close of the morning, eventually getting lifted at -$326/mt where it settled post-window. Oct LST/FEI also had some selling at the -$298.50/mt level. Interest returned in the Oct ENT/FEI arb, trading at -$314/mt, the same as the morning’s trading level. FEI spreads had little liquidity on the afternoon, but Sep/Oct softened to trade at $23.50/mt, and Sep/Dec was sold at $53/mt, before strengthening to $55/mt end window. There was also some FEI/MOPJ buying out of Q4 at -$74.50/mt, and the Sep Pronap was sold at -$210/mt, the same as earlier. In LST, there was some deferred selling of spreads, with Q4/1 lifted at -0.125c/gal, and Q1/2'27 was trading at 4c/gal. Oct/Nov LST was also getting sold at -0.5c/gal, up 0.125c/gal from yesterday’s closing level. Another thin afternoon in butane, with C4 ENT flat price trading up with crude, and Sep/Oct trading at -0.875c/gal.